Numerous governments mull the creation of their own state-backed cryptocurrency. Launching such a venture is a lot easier said than done. A new cryptocurrency will be introduced in the province of Gyeongsangbuk-do in South Korea. Their Gyeongbuk Coin replaces the existing system of using gift cards.

Modernizing Local Payment Systems

It is not uncommon for cities or provinces to offer their own payment system to boost the local economy. In a lot of cases, it uses a different means of exchanging value. South Korea’s province of Gyeongsangbuk-do achieves this goal by using gift cards. Known as Hometown Love Gift Cards, this tool was used by merchants across the province. It is this system which will be replaced entirely by this new cryptocurrency in the near future.

Replacing an exchanging means of exchanging value poses logistical issues. To incorporate the new cryptocurrency, an exchange will be built. This platform allows local residents to buy the coin with Korean Won. A total of $100 million worth of Gyeongbuk Coin will be issued every single year. That amount is on par with the value brought into circulation through the current gift card system.

This revamp comes after local benchmarkers took a trip to Zug. Switzerland’s “crypto hub” has shown a strong tendency to accept cryptocurrencies and incorporate blockchain technology. Thanks to a fruitful discussion, the concept for this new cryptocurrency will become a reality. It also appears officials contemplate creating a blockchain-based provincial government ID system.

Daegu, South Korea

Cryptocurrency Remains an Attractive Option

Any country or province can benefit from modern payment solutions. In this day and age, there are numerous solutions to streamline existing systems. Looking beyond traditional offerings remains a risk, but it can also offer many benefits. Gyeongsangbuk-do officials admit key challenges remain. That includes notifying merchants, creating new loyalty programs, and the issuance of coins.

Despite the potential hurdles, the concept of cryptocurrency remains rather appealing. Creating a new form of value altogether is always a challenge. However, cryptocurrencies offer a unified approach and rely on blockchain technology. Given the appeal of the blockchain, it is an option worth exploring on a small scale. That does not automatically mean this new cryptocurrency will become a success automatically.

Gyeongbuk Coin will be a very intriguing social experiment. The region is home to South Korea’s fourth-largest city known as Daegu. Moreover, this new currency addresses the “issue” of having nine different cities issuing their own gift cards. A unified approach appears to be in order, and Gyeongbuk Coin may be the right way to go about it.

What do you think about a region issuing their own cryptocurrency? Let us know in the comments below.

Images courtesy of Shutterstock.

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